• Best Practices

Student Success Checklist - Getting It Together Ahead of Financial Literacy Month

George Covino

 As we look ahead to National Financial Literacy Month, which is observed in April, we are reminded that a focus on financial literacy is important year round. It’s an effort to highlight the benefits of raising awareness about how to maintain healthy financial habits. College administrators have long recognized the need to provide money management education to students since they need so much help in funding their education, making the most of their financial aid and repaying their student loans. 

The 2016 Ruffalo Noel Levitz Motivation to Complete Report found that 50 percent of freshman want to talk with someone about getting scholarships and only 28 percent want to talk about getting a loan. While I don’t blame students for being averse to borrowing, this data indicates an unrealistic point of view. In addition, the 2016 Ahead of the Herd FAFSA completion report found that nationally, only 39.6 percent of high school seniors complete the FAFSA versus 66 percent that go to college. In 2014, the Gates Foundation found that of the two million students who did not complete the FAFSA, 1.3 million would have been eligible for a full Pell Grant, leaving approximately $7.5 billion in funds on the table.

Taking this data into account, here are some ideas for you to think about regarding money management education for your students:

It all starts with the FAFSA
Are you tracking FAFSA completion for incoming students? The Ahead of the Herd FAFSA data referenced above indicates that the state with the highest completion rate is Tennessee, where it’s estimated that 62.3 percent of high school students completed the document. That clearly indicated that there are opportunities to assist potential students far beyond what we are currently doing.

Are you tracking FAFSA completion for returning students? I have not been able to find any national data on the percentage of renewal students who actually complete the FAFSA. Anecdotally, financial aid professionals report that not all their renewal students complete the FAFSA or complete on time. I think it would be interesting to start tracking that data.

Both facts would indicate that we need to provide students with additional help in applying for financial aid. You might want to think about what are you are currently doing in this area and how you can get more students into the process.

Money Management Education is part of a holistic approach to student success
Again from the Ruffalo Noel Levitz Motivation to Complete report, only 38 percent of students agree that they don't have any financial problems that will interfere with their school work and almost 30 percent agree that they have financial problems that are very distracting and troublesome.

Our student and expert advisory board members recommended that topics related to budgeting, credit cards, managing student loan debt, making the most of savings, and avoiding and recovering from identity theft be included in any money management education efforts.

Further, Dr. Kim Brown Koutek’s research on financial literacy found that repeated exposure to financial literacy topics over time causes positive changes in behavior. Clearly, once is not enough for financial literacy topics. You may want to look at student pathways toward their degree and develop strategies for providing them with the information they need to successfully manage their money throughout their educational career.

Take a look at Student Connection’s Success Center
Both students and administrators told us that in order to have students access and use money management education, we needed to provide it in a format that was easy to access when and where they wanted. Part of our Success Center program, the WhichWay application currently offers six modules that can be easily consumed in short segments across multiple technology platforms. The modules are Understanding the Basics of Budgeting, Creating and Maintaining a Budget, Achieving Goals, Paying for College, Understanding Credit and Obtaining Credit.

If you are interested in learning more about how Student Connections can help you with your financial literacy efforts, you can schedule a demo here.

I’d be interested in knowing what you are currently doing to help your students complete the FAFSA and learn money management. Feel free to contact me via email, Twitter or LinkedIn.

George CovinoGeorge Covino is Student Connections’ vice president, student success.